Banking and Financial Institutions MCQs

Question 1

The success of e-banking depends upon 1. Multi-layer Security System 2. Risk and Surveillance Management 3. Updated Flawless Softwares 4. Stringent Legal Frame work Select the correct answer:

Accepted Answer

1, 2 and 3

Answer

Both 1 and 2

Answer

2, 3 and 4

Answer

All of the above

Question 2

Match the following items of List I with the items of List II and indicate the correct matching. List-I (Name of Bank) List-II (Year of Establishment) a. IFCI 1. 1981 b. SIDBI 2. 1982 c. NABARD 3. 1948 d. EXIM 4. 1990

Accepted Answer

a-3, b-4, c-2, d-1

Answer

a-3, b-1, c-2, d-4

Answer

a-4, b-2, c-3, d-1

Answer

a-4, b-3, c-2, d-1

Question 3

In case of Term Loans, the period of limitation is calculated as three years from:

Accepted Answer

Due date of each installment

Answer

Date of documents

Answer

Date of sanction

Answer

Date of default

Question 4

Identify the correct statement of the following

Accepted Answer

All are correct

Answer

NABARD was set up in order to provide credit for the promotion of the activities like rural crafts and agriculture

Answer

NABARD was set up in order to provide credit to poorer section of rural India

Answer

NABARD was set up in order to assist banks specially meant to surve rural India

Question 5

Consider the following statements. Assertion (A): A well-developed money market is the basis for an effective monetary policy. It is in the money market that the Central Bank comes into contact with the financial sectors of the economy as a whole and it is through the liquidity in the market that influences the cost and availability of credit. Reasoning (R): A well-organized money market is an essential condition for the successful operation of the Central Banking policies, and for holding the conditions of liquidity within the bounds of what the monetary authorities consider desirable.

Accepted Answer

(A) is true and (R) offers correct explanation to (A)

Answer

(A) is true but (R) is false

Answer

(R) is true but (A) is false

Answer

Both (A) and (R) are false

Question 6

Which one among the following has not started commercial banking?

Accepted Answer

SIDBI

Answer

IDBI

Answer

ICICI

Answer

UTI

Question 7

Loans against Shares/Debentures can be sanctioned against the security of:

Accepted Answer

Fully paid Equity Shares and debentures in demat form

Answer

Preference Share and Covertible debentures

Answer

All shares and debentures in physical form

Answer

Only Preference Share and partly paid debentures

Question 8

What are the elements of Tier-I capital, including additional Tier-I capital as per BASEL-III?

Accepted Answer

All of the above

Answer

Paid up equity capital, statutory & disclosed reserves

Answer

Capital reserves representing surplus arising out of sale proceeds of assets

Answer

Perpetual non-cumulative preference shares and debt capital instruments eligible for inclusion under additional tier-I

Question 9

Open market operations, one of the measures taken by RBI in order to control credit expansion in the economy, means:

Accepted Answer

Sale or purchase of Government securities

Answer

Issuance of different types of bonds

Answer

Auction of gold

Answer

To make available direct finance to borrowers